Political Parties Shifted Toward Small Donors; Played Historic Role In 2006

The Campaign Finance Institute has released a new study (attached), Party Money in the 2006 Elections: The Role of National Party Committees in Financing Congressional Campaigns by Anthony Corrado and Katie Varney.

Corrado is Charles A. Dana Professor of Government at Colby College and
Chair of the Board of Trustees of the Campaign Finance Institute.
Varney is a Research Associate at The Reform Institute and a graduate
of Colby College.

The
2006 elections were the first midterm elections since the Bipartisan
Campaign Reform Act of 2002 prohibited the parties from raising
unlimited "soft money" contributions. As a result, Corrado and Varney
say, there were major questions going into the election about how much
the national party committees would be able to raise and what role they
would play. "By the end of the election cycle, the parties had once
again demonstrated their ability to meet the challenges posed by BCRA,"
Corrado and Varney say.

"Overall, the national parties raised 75 percent
more hard money than in 2002, thereby replacing most (but not all) of
the soft money they had raised in the prior midterm".

"More importantly, they spent more money in 2006 directly supporting congressional candidates that they had in any previous
election."
As a result, they said after a detailed analysis of spending in close
races, "the party was a major voice – if not the dominant voice – in
many of the battleground congressional districts."

Corrado and Varney also highlight some major changes in the sources of
party funding between 2002 and 2006. "While unlimited soft money
donations were the primary source of party money in 2002, small
contributions from individuals were the principal sources of receipts
in 2006.

In 2002, about one of every two dollars received by the national party committees came from soft money donations.

In 2006, about one dollar in every three came from small, individual donations in amounts of less than $200.

Contributions from Members of Congress
have also become crucial for the party campaign committees. In the 2006
cycle, "the congressional campaign committees received more from those
who served in Congress than from large donors," who had been the major
sources of party funds in 2002.

Despite the parties'
strength in 2006, the authors conclude with some caution flags for
2008. "There is a question whether the parties will be able to sustain
their previous financial success in the context of unprecedented
fundraising by the presidential contenders," Corrado and Varney say.
"To date, the parties have demonstrated a capacity to adapt to changing
rules and strategic demands. In 2008, they will have to demonstrate
this capacity once again."